State of Bitcoin 2015

State of Bitcoin 2015
7th January 2015

Contents
1. 2014 in Review
1. Q4 Summary
• Price and Valuation
• Media
• VC Investment
• Commerce
• Technology
• Regulation and Macro
2State of Bitcoin 2015

About CoinDesk
• World leader in digital currency news, prices and information
• The Bitcoin Price Index serves as an industry reference point
• International team headquartered in London
• Editors based in London, New York, San Francisco and Tokyo

2014 in Review

Summary
Sustained price pressure may lead to
a shakeout in the mining sector and
likely consolidation among exchanges
Overall, 2014 was a ‘tale of two
bitcoins’ – the bitcoin economy made
progress while bitcoin’s price saw a
steady decline
All-time bitcoin VC investment passed
$400m in Q4 and exceeded early-
stage Internet investment in 1995
Q4 saw some regulatory clarity with
welcomed revisions to the NY
BitLicense and no new major
regulatory setbacks
Larger businesses continue to adopt
bitcoin, with Microsoft and Time
accepting bitcoin in Q4
Bitcoin was the worst-performing
currency in 2014, down 67% and
another 18% so far in 2015

Key Bitcoin Adoption Metrics
Sources and notes: CoinDesk, Blockchain.info, BitcoinPulse, Github, Coin ATM Radar. Figures are cumulative from start of records, except unique bitcoin
addresses and media mentions, which are figures for the quarter ending that month.
Quarterly Last 12 Months
Dec-14 Sep-14 Q/Q Δ Dec-13 Δ
Commerce
Wallets 7,948,272 6,559,978 21% 3,194,584 2x
Merchants 82,000 76,000 8% 35,903 2x
Merchants’ annual revenue ($bn) 180 86 109% 0 N/A
ATMs 341 251 36% 4 85x
Unique bitcoin addresses 157,377 184,554 -15% 108,166 45%
Industry
All-time VC investment ($m) 432.7 302.9 43% 97.9 4x
Number of VC-backed startups 83 68 22% 30 3x
Media
Mainstream media mentions 673 687 -2% 2,889 -76%
Technology
Network hash rate (billion/second) 335,365,290 249,839,180 34% 9,920,977 34x
Github no. of updated repositories 23,249 18,753 24% 4,410 5x
Valuation
Bitcoin market capitalization ($bn) 4.3 5.2 -17% 9.3 -54%

$200
$300
$400
$500
$600
$700
$800
$900
$1,000
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14
11 Apr
PBOC official
says China will
not ban bitcoin
11 Aug
Blockchain first
company to pass
over 2m bitcoin
wallets
11 Dec
Microsoft adds
bitcoin payments
for Xbox games
and mobile content
Key Events and Price Chart in
2014
23 Sep
PayPal
announces
bitcoin
partnerships
11 Feb
Massive DDoS attack exploits
transaction malleability bug
Source: CoinDesk Bitcoin Price Index, daily data collected at 00:00 UTC www.coindesk.com/price
18 Jul
Dell
announces it
will accept
bitcoin
18 Dec
Favorable revisions
made to proposed NY
BitLicense
18 Jun
List of possible
Silk Road bitcoin
bidders leaked by
US Marshals
6 Mar
Newsweek claims to
have found bitcoin
inventor Satoshi
Nakamoto
25 Feb
Mt Gox closes,
announces
744,408 BTC
($350m) missing
12 Jun
$18m in Silk
Road bitcoins
sold by US
Government
2 Jul
VC Tim Draper
revealed as Silk
Road bitcoin
auction winner

Total Exchange Trading Volume
Increased by Over 50%
Sources: CoinDesk, Blockchain.info, Bitcoinity
Total Bitcoin Trading Volume (BTC)
51
80
0
10
20
30
40
50
60
70
80
90
2013 2014
Millions
$15
$23
$0
$5
$10
$15
$20
$25
2013 2014
Billions
Total Bitcoin Trading Volume ($bn)

CoinDesk's Top 10 News Stories of 2014
Rank Title Date
1 Bitcoin Exchanges Under 'Massive and Concerted Attack' 11th Feb
2 Why Mt. Gox, the World’s First Bitcoin Exchange, is Dying 8th Feb
3 Alpha Technology Takes Pre-Orders for Litecoin ASIC Miners 3rd Jan
4 Mt. Gox Halts ALL Bitcoin Withdrawals, Price Drop Follows 7th Feb
5 Mt. Gox Allegedly Loses $350 Million in Bitcoin, Rumoured Insolvent 25th Feb
6 List of Possible Silk Road Bitcoin Bidders Leaked by US Marshals 18th Jun
7 CoinDesk Removes Mt. Gox from Bitcoin Price Index 10th Feb
8 56% of Bitcoiners Believe the Bitcoin Price Will Reach $10k in 2014 2nd Jan
9 Leading Adult Site Porn.com Now Accepts Bitcoin 3rd Jan
10
Bitcoin Price Hits $135 on Mt. Gox Following Office Move and Verification
Demand
20th Feb
Sources and notes: CoinDesk. Based on total pageviews.

2014 Bitcoin Venture Capital Investment
$433m$335m
Total VC investment in
cryptocurrency startups to date:
2014 bitcoin VC investment:
$96m
2013 bitcoin VC investment:
+342%
Increase in total to-date VC
investment from end of 2013:
Source: CoinDesk (www.coindesk.com/bitcoin-venture-capital/)

Two Biggest VC Deals in 2014
$30m $30.5m
(Series A) October 2014(Series A) May 2014

2014 Bitcoin VC Investment Surpassed
Early-Stage Internet Investment
*Includes first sequence venture deals but excludes late-stage 1995 Internet investments ($257.6m). For additional disclosure
on methodology see www.coindesk.com/following-money-trends-bitcoin-venture-capital-investment/
$95.8
$334.8
$250.1
$0
$50
$100
$150
$200
$250
$300
$350
2013 Bitcoin 2014 Bitcoin 1995 Internet*
Bitcoin vs Early Internet VC Investment ($m)
Sources: CoinDesk, PricewaterhouseCoopers

Number of Countries With Bitcoin VC
Investment Grew From 8 to 18 in 2014
New countries receiving investment for bitcoin companies in 2014: Japan, Netherlands, Panama,
Denmark, Luxembourg, Sweden, Germany, India, Mexico, Argentina
Countries
receiving
first VC
investment
in 2012-13
Countries
receiving
first VC
investment
in 2014
Source: CoinDesk (www.coindesk.com/bitcoin-venture-capital/), generated by DataWrapper

2013 vs 2014 Investment Shift Towards
Wallets, Mining and Financial Services
2013 vs 2014 VC Investment by Ecosystem Category
$25.4
$26.7
$49.7
$69.5
$75.4
$88.1
$40.5
$24.0
$3.2
$12.1
$15.0
$1.1
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100
Universal Exchange Payment
Processor
Mining Financial
Services
Wallet
2014 VC Investment (millions) 2013 VC Investment (millions)

Companies Moving into New Product
Categories
Wallet
Infrastructure
Jul 2013
+
Wallet + Exchange
Sep 2014
Payment
Processor
+ Infrastructure
Feb 2014
Exchange
Sep 2014
+
Source: CoinDesk

Mergers and Acquisitions Announced in
2014, More Expected in 2015
Oct 2014
Aug 2014
Aug 2014
Jul 2014
Source: CoinDesk

Number of Universal Bitcoin Companies
Doubled in 2014
• Universals operate across more than
one aspect of the bitcoin value chain
(eg Coinplug provides payment
processing, wallet and ATMs)
• More and more bitcoin startups
continue to pursue the universal
model
• Universal bitcoin companies leverage
two key elements of financial
services: efficiency and trust
The Universals
2013
2014

Total Altcoins Grew from 64 to 590 in 2014, Bitcoin’s
Market Cap is 6X Larger Than the Next Biggest
Source: CoinMarketCap data as of 3rd Jan 2015
Rank Name MarketCap
1 Bitcoin $ 4,132,670,815
2 Ripple $ 706,795,764
3 Litecoin $ 79,521,355
4 BitShares $ 38,420,086
5 PayCoin $ 35,959,731
6 MaidSafeCoin $ 23,917,169
7 Nxt $ 18,392,947
8 Stellar $ 17,713,142
9 Dogecoin $ 17,145,911
10 Peercoin $ 11,573,821

Q4 2014

Price and Valuation

CoinDesk Bitcoin Price Index –
Q4 & YTD by the Numbers
Source: CoinDesk Bitcoin Price Index, daily data collected at 00:00 UTC
www.coindesk.com/price

$300
$325
$350
$375
$400
$425
$450
30-Sep 07-Oct 14-Oct 21-Oct 28-Oct 04-Nov 11-Nov 18-Nov 25-Nov 02-Dec 09-Dec 16-Dec 23-Dec 30-Dec
Bitcoin’s Price Fluctuated Throughout Q4 on
Mixed News
11 Dec
Microsoft adds bitcoin
payments for Xbox
games and mobile
content
3 Oct
Russia proposes
monetary penalties
for bitcoin use and
promotion
Source: CoinDesk Bitcoin Price Index, daily data collected at 00:00 UTC www.coindesk.com/price
16 Oct
Bitcoin Group
seeks to launch
world's first
Bitcoin IPO
Boost VC goes
‘full bitcoin' for
next startup
mentor round
22 Nov
4 Dec
Daily bitcoin
transactions pass
100,000 milestone
10 Dec
Hacker returns
225 BTC taken
from Blockchain
wallets
18 Dec
Lawsky outlines
relaxation of New
York BitLicense
12 Nov
Bitcoin price
surges past $400
mark for the first
time since mid-
October

Monthly Exchange Trading Volume
Increased in Q4 …
Sources: CoinDesk, Bitcoinity
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
Monthly Bitcoin Trading Volume (bitcoins)

…and Recently Surpassed Previous Highs
From End of 2013
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14
Monthly Bitcoin Trading Volume (bitcoins)

State of Altcoins: Growth Rate of New Altcoins Slowed in Q4
by More Than 15%, Market Cap Share Steady at 9%*
Sources: CoinMarketCap, Internet Archive
TotalNumberofAltcoins
*Altcoin market cap share calculated by dividing the sum of all non-bitcoin cryptocurrency market caps by all cryptocurrency market caps
(including bitcoin). For example, if altcoins have 8% market value share, then bitcoin has 92% market value share. Total number of altcoins
is the number at the end of each quarter.
64
216
347
483
590
68.4%
237.5%
60.6%
39.2%
22.2%
0%
50%
100%
150%
200%
250%
0
100
200
300
400
500
600
700
Dec-13 Mar-14 Jun-14 Sep-14 Dec-14
Total Number of Altcoins
Quarterly Growth in New
Altcoins

Selection of Q4’s Biggest Bitcoin Stories
White-hat hacker exploits security flaw in
Blockchain wallets to take 255 BTC
Microsoft is now the most notable business on
the list of bitcoin-accepting businesses
Overstock significantly misses 2014
bitcoin sales projections
Bitcoin
network
difficulty
declined for
first time in
two years

Most Popular CoinDesk Q4 Stories
Rank Title Date
1 Bitcoin Price Finds Hard Floor Following 26,000 BTC Sell Order 6th Oct
2 Bitcoin Price Surges Past $400 Mark 12th Nov
3 State of Bitcoin Q3 2014: Ecosystem Maturing Amid Price Pressure 7th Oct
4 MIT Bitcoin Trading Simulation Yields Profit of 89% in 50 Days 14th Oct
5 Microsoft Adds Bitcoin Payments for Xbox Games and Mobile Content 11th Dec
6 Fire Destroys Thai Bitcoin Mining Facility 6th Nov
7 Gavin Andresen Proposes Bitcoin Hard Fork to Address Network Scalability 8th Oct
8 Markets Weekly: Bitcoin Price Resilience Crumbles 27th Oct
9 Why Wall Streeters are Turning to Bitcoin for a Living 26th Oct
10 Markets Weekly: Bitcoin Bulls Return in Wake of BearWhale Slaying 13th Oct
Source: CoinDesk

News Coverage of Bitcoin Declined on Most
Mainstream News Sites in Q4
News Published Mentioning Bitcoin
0 100 200 300 400 500 600
FT
NYT
WSJ
Sina
Q3 2014
Q4 2014
Note: Numbers of stories obtained by searching ‘bitcoin’ on respective publishers’ websites
Sources: respective publishers’ websites

‘Bitcoin Price’ is Top Q4 Search Term,
‘Bitcoin Bowl’ Achieved High Share
Past 90
Days
Related Searches: Top Related Searches: Rising
Past 12 Months
Source: Google Trends data as of 3rd Jan 2015

VC Investment

Two Biggest Bitcoin VC Deals in Q4
$30.5m $21m
(Series A) November 2014(Series A) October 2014

Q4 Bitcoin Venture Capital Investment Nearly
Doubled Q3 Total
$433m$130m
Total VC investment in
cryptocurrency startups to date:
Q4 2014 bitcoin VC investment:
$64m
Q3 2014 bitcoin VC investment:
Sources: CoinDesk (www.coindesk.com/bitcoin-venture-capital/), CrunchBase
+43%
Increase in total to-date VC
investment from end of Q3:

Europe Continues to Heat Up as Overall Investment Share
Increased in Q4, Largest Regional Q/Q% Increase
Regions
Q4
($m)
Q3
($m)
Q/Q Δ
($m)
Q/Q Δ
US &
Canada
285.4 215.8 69.6 32%
Europe 99.2 48.7 50.5 104%
Asia 31.0 26.9 4.1 15%
Middle
East
10.5 5.5 5.0 91%
Latin
America
6.0 6.0 0.0 0%
Total 430.5 303.5 127.4 42%
$ Invested as of Q3
• Middle East had the second largest Q/Q% increase in investment
• US & Canada share declined slightly, but still dominated with 66% of all VC $
to date Note: $ invested represents all-time total bitcoin VC investment at the end of each respective quarter. The
headquarters of one company receiving VC investment in Q4 is unknown.
$ Invested as of Q4
US &
Canada
71%
Europe
16%
Asia
9%
Middle
East
2%
Latin
America
2%
US &
Canada
66%
Europe
23%
Asia
7%
Middle
East
3%
Latin
America
1%

While the US Continues to Dominate Bitcoin VC
Investment, Total Share Declined by 11% in Q4
$0.2 $0.3 $0.3 $0.3 $0.5 $0.6 $0.8 $1.2 $1.8 $3.4 $4.0 $6.9 $10.5 $14.9 $18.1
$25.0
$40.7 $42.9
$260.4
$0
$50
$100
$150
$200
$250
$300
Total Funding (millions)

Silicon Valley’s Share of All-Time Bitcoin VC Investment
Declined Slightly From 29% in Q3 to 27% in Q4
Tech hub
concentration
Value ($m)
No. of
companies
Silicon Valley 116.4 15
Rest of World 316.3 68
Total 432.7 83
• Total number of VC-backed bitcoin companies increased from 68 in Q3 to 83
in Q4, a 22% increase
$ Invested No. of Companies
Silicon
Valley
27%
Rest of
World
73%
Silicon
Valley
18%
Rest of
World
82%

The Bitcoin Startup Ecosystem:
Six Different Bitcoin Company Categories
Universal
Payment
Processing
Wallets
Mining
Financial
Services
Exchanges

Wallets Raised the Most Funding in Q4,
Followed by Mining and Financial Services
Q4 VC Investment by Ecosystem Category (millions)
$2.7 $2.7
$16.0
$33.6
$34.8
$40.0
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
Universal
Exchange
Payment Processor
Mining
Financial Services
Wallet

Financial Services Took Over Universal, Receiving
the Most VC Investment
• Wallets, Financial Services and Mining sectors continued to receive the lion’s share
of investment in Q4
• Universals only received $2.7m in last quarter
$ Invested as of Q3$ Invested as of Q4
Note: $ invested represents all-time total bitcoin VC investment at the end of each respective quarter.
Universal
15%
Financial
Services
21%
Mining
19%
Wallet
21%
Exchange
12%
Payment
Processor
12% Universal
21%
Financial
Services
18%
Mining
16%
Wallet
16%
Exchange
16%
Payment
Processor
13%
Sector
Q4
($m)
Q3
($m)
Q/Q Δ
($m)
Q/Q Δ
Universal 66.5 63.8 2.7 4%
Financial
Services
90.4 55.6 34.8 62%
Mining 81.6 48.0 33.6 70%
Wallet 89.2 49.2 40.0 81%
Exchange 50.7 48.0 2.7 6%
Payment
Processor
54.3 38.3 16.0 42%
Total 432.7 302.9 129.8 43%

Q4 Investment Rounds in Bitcoin Startups
Source: CoinDesk (http://www.coindesk.com/bitcoin-venture-capital/)
Close Date Company Size ($m) Round Select Investors Headquartered
Dec-14 Bitreserve 9.5 Second Undisclosed San Francisco
Dec-14 BitGold 3.5 Third
PowerOne Capital, Soros Brothers
Investments, Sandstorm Gold
Toronto
Dec-14 PeerNova 8.6 First
Mosaik Partners, Steve Case,
Crypto Currency Partners
San Jose
Dec-14 ChangeTip 3.5 First
Pantera Capital, 500 Startups,
Boldstart Ventures, CryptoCurrency
Partners
San Francisco
Dec-14 DigiByte 0.25 Seed Undisclosed Santa Monica
Dec-14 GetGems 0.6 Seed Magma VC Unknown
Nov-14 Purse.io 0.3 Seed
Roger Ver, Bobby Lee, Terrence
Yang, FundersClub, StrongVC
San Francisco
Nov-14 Blockstream 21 First
Reid Hoffman, Khosla Ventures,
Real Ventures, Crypto Currency
Partners
Montreal

(contd.)
Nov-14 Dogetipbot 0.45 Seed
Blackbird Ventures, Scott and Cyan
Banister, Individual Investors
Redding
Nov-14 CoinOutlet 0.05 Seed BitcoinShop New York
Oct-14
Spondoolies-
Tech
5 Second
Agile Wings, BRM Group, Genesis
Partners, Olivier Janssens
Kiryat Gat
Oct-14 BitLendingClub 0.25 Seed LAUNCHub San Francisco
Oct-14 Bitnet 14.5 First
Highland Capital Partners,
Rakuten, James Pallotta, Stuart
Peterson
San Francisco
Oct-14 AlphaPoint 1.35 Seed
Ben Franklin Technology Partners,
Robin Hood Ventures
New York
Oct-14 Coinsetter 1.3 First Unknown New York
Oct-14 BitFlyer 0.24 Seed Bitcoin Opportunity Corp. Tokyo

(contd.)
Oct-14 Libra 0.5 Seed
Liberty City Ventures, James
Pallotta, Ben Davenport
San Francisco
Oct-14 Melotic 1.18 Seed
Ceyuan Ventures, Lightspeed
China, Bitcoin Opportunity Corp
Hong Kong
Oct-14 Devign Lab 0.2 Seed K Cube Ventures Seoul
Oct-14 BitFury 20 Second
Bill Tai, Bob Dykes, Georgian Co-
Investment Fund, Lars Rasmussen
Amsterdam
Oct-14 Coinplug 2.5 First
Mirae Asset Venture Investment,
Bokwang Investment Corp
Seoul
Oct-14 Blockchain 30.5 First
Lightspeed Ventures, Wicklow
Capital, Mosaic Ventures
York
Oct-14 SolidX 3 First
Liberty City Ventures, James
Pallotta
New York
Oct-14 Snapcard 1.5 Seed
Tim Draper, Crypto Currency
Partners, Insikt Ventures
San Francisco

Commerce

>82,000 Merchants Now Accept Bitcoin,
Up From 75,000 in Q3 (+9%)
44K 38K
Sources: Coinbase and BitPay

Total merchants Forecasted merchants
140,000 Bitcoin-Accepting Merchants
Forecast by End of 2015
Sources and notes: total current merchants based on data from Coinbase and BitPay. Historical Coinbase data provided by BitcoinPulse.
BitPay historical data between new merchant press release announcements of 10,000 (16th Sep 2013), 20,000 (13th Jan 2014) and 30,000
(28th May 2014), respectively, calculated using linear interpolation.
R² = 0.962
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000

Growth in Bitcoin-Accepting Businesses
Slowed Throughout 2014
13,903
16,800
12,936
10,360
6,000
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014
Number of New Bitcoin-Accepting Businesses Added Each Quarter

Companies Representing >$180 Billion in
Annual Revenue Now Accept Bitcoin
Top 10 Largest Bitcoin-Accepting Retailers
*Monprix is a private company; most recent revenue data is from 2005. TigerDirect estimate provided by parent company investor relations. Other divisions
that are part of a larger parent organization, but do not break out individual divisional revenues, are excluded.
Rank Company Annual Revenue ($bn)
1 Microsoft 86.8
2 Dell 56.9
3 Dish Network 13.9
4 Expedia 5.0
5 Intuit 4.5
6 Monprix* 4.3
7 Time Inc.** 3.4
8 NewEgg 2.8
9 Overstock 1.3
10 TigerDirect* 1.0
Total $179.9
**The revenue is Time Inc. FY 2013 revenue
Sources: CoinDesk, Coinbase, BitPay, companies’ annual reports

What Do People Buy with Bitcoins?
Home Goods & Consumer Electronics
Source: most popular items purchased through Purse.io by November 2014
Trashbags Coffee Grinder Infant Formula
Home
Goods
Bluetooth SpeakerDigital CameraPlaystation
Consumer
Electronics

Total Wallets Forecasted Wallets
Approximately 12 Million Bitcoin Wallets
Forecast by End of 2015
R2 = 0.971
Sources and notes: total wallets based on data from Blockchain.info, MultiBit, Coinbase, Andreas Schildbach (Android Bitcoin Wallet
developer). Historical Coinbase data provided by BitcoinPulse.
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
Jan-13
Mar-13
May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Jan-15
Mar-15
May-15
Jul-15
Sep-15
Nov-15
Jan-16

Daily Bitcoin Transactions Passed
100,000 for the First Time in Q4
Source: Blockchain.info
• Questions linger over how significant a milestone this is, given uncertainty over
how many of these transactions represent bona fide economic activities

Now Over 320 Bitcoin ATMs
Around the World
Source: CoinDesk (www.coindesk.com/bitcoin-atm-map/)
1213246

0
100
200
300
400
500
600
700
800
Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16
Total ATMs Forecasted
ATMs
Approximately 750 Bitcoin ATMs Forecast by
End of 2015
R2 = 0.973
Sources: CoinDesk, CoinATMRadar

Lamassu Led ATM Deployments in 2014,
Skyhook Became Second Largest
Lamassu
accounts
for over a
third of the
bitcoin ATM
market
Sources: CoinDesk, CoinATMRadar

Most Bitcoin ATMs Located in Stores,
Restaurants and Coffee Shops
Source: CoinDesk, www.coindesk.com/6-charts-show-massive-bitcoin-atm-growth-2014/

Technology

0
5,000,000,000
10,000,000,000
15,000,000,000
20,000,000,000
25,000,000,000
30,000,000,000
35,000,000,000
40,000,000,000
45,000,000,000
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14
Bitcoin Network Difficulty Declined for First
Time in Two Years
The drop in difficulty was
expected due to depressed
bitcoin prices*
*CoinDesk examined the issue in September 2014 and concluded that difficulty could reverse if prices do not recover www.coindesk.com/bitcoin-mining-
can-longer-ignore-moores-law/
Source: CoinDesk
Bitcoin Mining Difficulty

Discus Fish
AntPool
GHash.IO
KnCMiner
BTCChina Pool
BTC Guild
Slush
Unknown with
1AcAj9p Address
Eligius
P2Pool
Bitcoin Affiliate
Network
Unknown
with
1BwZeHJ
Address
BitMinter
Megabigpower
MegaBigPower
EclipseMC
mmpool
Polmine
CloudHashing
Unknown
Mining Pools: GHash Continues to Shrink,
No Permanent Solution for 51% Attack Risk Yet
Source: 4-day average as of 3rd Jan 2015 blockchain.info/pools

CoinBase’s API Gaining Traction With
44 Bitcoin Apps Built on it
Source: CoinBase

Bitcoin Developer Ecosystem Continues to Grow
Number of created repositories in GitHub with bitcoin in the name or description
Source: BitcoinPulse

Number of Bitcoin Nodes Has Leveled Off in
Last Two Quarters
Source: BitcoinPulse

Crypto 2.0 Projects to Keep an Eye on
in 2015
BitAssets – allowing traders to hedge
against bitcoin's fluctuations
Alternative blockchain to bitcoin’s
Decentralised social messenger
Bringing smart contracts to market
Source: CoinDesk

Bitcoin Companies are Collaborating on
Security Across Industry Sectors
Source: CoinDesk

Adoption of Multi-signature (Multisig) Wallet
Security Increased in 2014
• Multisig: advertised as the digital equivalent of a safe deposit box.
• At the beginning of 2014, only 0.02% of all bitcoins featured multisig
security, that number is now more than 5%.
• These companies now utilize multisig:
Source: BitGo

Regulation and Macro

Over 250 Academic Articles on Bitcoin to Date
Cover a Wide Range of Research Topics
Source: Peer-to-Peer Review: The State of Academic Bitcoin Research 2014 by Brett Scott.
Word Cloud of 250 article titles generated using Tagul.

A Number of Countries Expressing Interest
in Regulating Bitcoin as a Commodity
• US Commodities Futures and Trading Commission said it had oversight over
bitcoin and digital currencies because they could be defined as a commodity.
• Bitcoin has been classified as a commodity in Finland after the Scandinavian
country’s central bank declared that it did not meet the definition of a currency.
• Grant Spencer, deputy governor of New Zealand's Reserve Bank, said bitcoin
"behaves more like a commodity than a currency”.
Source: CoinDesk

Some Positive Developments with
New York’s BitLicense Regulatory Framework
• New York’s BitLicense regulatory proposal
widely regarded as a possible framework for
other jurisdictions.
• Ben Lawsky announced the latest revisions
to the draft BitLicense in mid-December.
• Clarified and narrowed which players in the
digital currency industry would be required to
obtain a BitLicense.
• Fewer disclosure and record-keeping
requirements for transactions.
• The proposed record-keeping
requirement for licensees reduced from 10 to
seven years.
• Broader range of financial assets (that
includes virtual currency) that can be
counted towards licensees' capital
requirements.
Ben Lawsky
Source: CoinDesk

Some Bitcoin Firms are Making Progress
with Banking Relationships
Source: CoinDesk
Safello first to
partner with UK
bank
Unisend re-
established
partnership with
a state bank
UK Banks

Russia is Illustrative of the Topsy-Turvy
Nature of Bitcoin Regulation
3 Oct
Russia proposes
monetary penalty
for bitcoin usage
and promotion
4 Dec
Russian
conference
presses on under
threat of bitcoin
ban
10 Nov
Russia lowers
proposed
penalties for
bitcoin activities
29 Dec
Russian
ministry
criticises draft
bill banning
bitcoin
9 Oct
Russia's startups
seek refuge
abroad under threat
of bitcoin ban
6 Oct
Russia seizes
bitcoin mining
equipment in incident
at China border
Source: CoinDesk

Highlights for bitcoin in 2014
• 25% mention more merchants’ acceptance, VC investment and
technology improvement
Biggest setback for bitcoin in 2014
• 33% mention price drop and Mt Gox’s collapse
What to look forward to for bitcoin in 2015
• 83% expect bitcoin VC funding to surpass investment in 2014
• 54% indicate US and Argentina are likely to see greater relative
adoption of bitcoin
• 42% mention security development as a focus
• 33% mention bitcoin seeing more traction in emerging markets
Highlights from Bitcoin Thought
Leaders Survey
Source: CoinDesk Bitcoin Thought Leader Annual Survey (an informal survey sent to a small number of bitcoin community influencers)

Views on the Highs and Lows for
Bitcoin in 2014
Source: CoinDesk Bitcoin Thought Leader Annual Survey
Tyson Cross, tax attorney
“From a tax prospective,
the biggest setback for
bitcoin in 2014 was its
classification as ‘property’
instead of ‘foreign
currency’.”
Brett Scott, author
“I'm pleased that people
began to discuss non-
monetary uses of
blockchain technology
more during 2014.”
Ola Doudin, BitOasis &
YellowPay
“I think 2014 was a
positive year (for bitcoin) in
Middle East where you
see more startups
launching, more eager and
serious players in the
space, and more
consumer awareness.”

Views On What Lies Ahead for Bitcoin
Regulation and Price Volatility in 2015
Ivan Brightly, SolidX
Partners
“In 2015, I expect that the
marginal buyers are
hedge funds, family
offices, high net worth
individuals and the like.”
Izabella Kaminska,
Financial Times
“Regulation is an
existential threat for
bitcoin because it can only
compete effectively if it
remains an unregulated
asset class.”
Gil Luria, Wedbush
Securities
“Volatility is part of the
currency and is unlikely to
go away.”

Views On What Lies Ahead for Bitcoin
Regulation and Price Volatility in 2015
Will O’Brien, BitGo
“I believe there will be continued
adoption by top merchants and
we may see the first adoption by
a mainstream consumer
payment network.”
David Yermack, NYU Professor of
Finance
“I believe bitcoin commerce will
become increasingly concentrated
online. Accepting bitcoin makes little
sense for face-to-face transactions
with ordinary merchants due to the
delays in validation.”

Views on Bitcoin
Jon Matonis
Founding Director
Bitcoin Foundation

Factoring in Remittance Fees Makes Sub-
Saharan Africa Most Fertile Market for Bitcoin …
Source: Hileman (2014) ‘Bitcoin Market Potential Index’, London School of Economics working paper.
Announcement article: www.coindesk.com/argentina-most-likely-adopt-bitcoin/
BMPI Regional Distribution -
Top 30
BMPI Regional Distribution -
Top 10
Asia 0%
Europe
10%
Middle East
& North
Africa 10%
Latin
America
20%
US &
Canada
10%
Sub-
Saharan
Africa 40%
Post-
Soviet/Com
munist 10% Asia
7%
Europe 3%
Middle East
& North
Africa 13%
Latin
America
17%
US &
Canada 3%
Sub-
Saharan
Africa 40%
Post-
Soviet/Com
munist 17%

… Yet Bitcoin Regulation in Africa
Lags Behind the Rest of the World
Source: Wikipedia https://team.cartodb.com/u/andrew/viz/365aa620-c273-11e4-bac7-0e018d66dc29/embed_map

About CoinDesk
• Find out more at www.coindesk.com
• Follow us on Twitter: @CoinDesk
• Subscribe to our daily email newsletters for the latest digital currency news
• If you have data you think should be included in future State of Bitcoin
reports, email stateofbitcoin@coindesk.com
• We also welcome any feedback you have on the report

Disclaimer
• CoinDesk makes every effort to ensure that the information in this
presentation is accurate and up to date. We cannot, however, accept
responsibility for any loss or inconvenience caused by reliance on the
material contained here.
• This presentation does not constitute financial advice or an investment
recommendation in any way whatsoever. It is recommended that you
perform your own independent research and/or speak with a qualified
investment professional before making any financial decisions.

State of Bitcoin 2015

More Related Content

What's hot (20)

Similar to State of Bitcoin 2015 (20)

Recently uploaded (20)

State of Bitcoin 2015

Editor's Notes